Shore Capital Group Limited – Acquisition of Controlling Interest in German Telecoms Business

Hamilton, Bermuda – 14 March, 2011 – Shore Capital Group Limited (the ‘Company’; Ticker: SGR.BH), the AIM-listed investment banking group, is pleased to announce that it has led an investor group which has agreed to acquire, subject to completion, a controlling interest (58 per cent) in DBD Deutsche Broadband Dienste GmbH (“DBD”), a German telecoms business. 

DBD began business in 2005 using microwave radio spectrum licensed to it by the German telecoms regulator to provide broadband services as an alternative to the broadband and telephone offerings of fixed wire-based telecom operators.  To do this, it deployed Wi-Max technology. 

DBD holds microwave radio spectrum with coverage across Germany which it acquired in a licence auctions and by acquisition and has established an extensive network across Germany of towers, transmitters and control equipment.  DBD is currently not profitable and the now wide availability of fixed broadband across Germany from other suppliers using telecom wires has made DBD’s radio-based offering relatively less attractive.

The investors have formed a new company, Spectrum Investments Limited (“Spectrum”), to acquire control of DBD.  By exploiting Israeli-developed radio technology from Spectrum, DBD plans to broaden its offering by adding telecom services to business customers, including mobile operators to assist them in providing 4G data services to their own customers more efficiently and reliably.  Spectrum will be working with DBD’s management team to implement this plan.

Shore Capital has invested €2.885m to acquire a majority interest in Spectrum which in turn will hold the controlling interest in DBD.  Shore Capital is backing a management team of Israeli entrepreneurs who are co-founding the company.  Other investors include additional specialists in telecommunications, together with a number of directors and employees of Shore Capital who have co-invested.  Howard Shore, Graham Shore and Zvi Marom, directors of Shore Capital, are joining the board of Spectrum.

Howard Shore, chairman of Shore Capital, said: “We are delighted to be expanding our principal finance activities with this opportunity in radio spectrum.  We already have a strong operation in Germany, where we manage a substantial property business.  We are excited by the plan to back this management team to use new technology to turn around the business.”

For more information:

Shore Capital Group plc

Howard Shore                                                 +44 (0) 20 7468 7911